Home -> Law Blog Directory -> Indiana Blogs -> Indiana Civil & Business Lawyer

Indiana

: Indiana Civil & Business Lawyer

Trade Secrets, Departing Employee News

Yet another departing employee draws litigation to the new employer. (For other, similar cases, just click on the "Trade Secrets" link below). This time Motorola sues a former employee taking a job with Apple. Who could not have seen this one coming?

Information Week ran Motorola Sues Ex-Executive For Going To Apple:

Motorola (NYSE: MOT) filed a lawsuit in Illinois a couple days ago against a former executive that left the company to become the head of Apple's iPhone sales division. This comes in a long line of departures for the flailing device maker, as it's lost several valuable employees to rival companies in recent months.

The suit names Mike Fenger, who quit Motorola in March as senior vice president of mobile devices for Europe, Middle East and Africa, and claims breach of contract and misappropriation of trade secrets when he violated his noncomplete agreement by leaving the company for Apple.

***

Seems Motorola isn't going quietly, as this isn't the first time they've brought legal action against former employees for joining rival companies. In 2005, they filed suit against former COO Mike Zafirovski when he was hired as CEO of Nortel Networks. In this case, Zafirovski was forced to refrain from contacting certain customers and from shaping Nortel's strategy to compete against Motorola for 18 months after he left.

The fact that so many employees are leaving for Apple is what really rubs Motorola the wrong way. Apple seems to be throwing it in their faces as well with stunts like a recruiting fair this past spring in a Mundelein, Illinois hotel near the Libertyville headquarters of Motorola's mobile-devices division. Supposedly, they were forced to cancel an earlier recruiting fair at the same hotel after receiving a cease-and-desist letter from Motorola.

It's also interesting that when Mr. Fenger was leaving Motorola to join Apple, it was also the same time Apple was making global expansion of the iPhone their top priority. Since Fenger was head of Motorola's global device division in Europe, Middle East and Africa, it gave him the perfect international know-how to expand the iPhone globally. Before overseeing Europe, Middle East and Africa, Mr. Fenger had run the Latin American operations for Motorola as well. The iPhone just so happens to be making its way there too, Coincidence?

Palluxo.com published Motorola Sues Apple Executive for Disclosing Trade Secrets:

Michael Fenger accepted ?millions of dollars in cash, restricted stock units, and stock options? in exchange for agreeing not to join a competitor for two years after leaving Motorola, where he oversaw mobile devices in Europe, the Middle East and Africa, the lawsuit said.

?He was privy to the pricing, margins, customer initiatives, allocation of resources, product development, multiyear-product, business and talent planning, and strategies being used by Motorola,? according to the complaint filed late Thursday.

Motorola has asked the Cook County to force the defendant to pay damages and repayment of stock options, which he received in exchange for signing the non-compete agreement. The suit demands Fenger stop soliciting or hiring Motorola employees or disclosing corporate secrets to Apple. Motorola seeks a court order barring Fenger from working for Apple for two years, retroactive to March 31.

domain-b.com has Motorola sues former executive for taking iPhone job:

The former executive also hired away two high-level Motorola employees who have access to Motorola's trade secrets and customer relationships, the lawsuit filed in Illinois said.

Motorola, an early bird which failed to cater to the market, has been loosing several of its valuable employees to rival companies in recent months as the company continued to lose ground.

Motorola had, in 2005, filed a similar suit against former COO Mike Zafirovski when he was hired as CEO of Nortel Networks. Zafirovski was forced to refrain from contacting certain customers and from shaping Nortel's strategy to compete against Motorola for 18 months after he left.

More Motorola employees are now flocking to Apple while iPhones are heading to Europe, Middle East, Africa and Latin America where Fenger had run Motorola operations earlier. This is what really worries Motorola.

From Mobiledia comes Motorola Sues Former Executive Over iPhone Job at Apple:

Fenger, who now serves as vice president of global iPhone sales, also hired away two high-level Motorola employees who have access to Motorola's trade secrets and customer relationships. The suit didn't name the two employees he allegedly helped Apple recruit.

***

Among the high-ranking executives who moved to rivals are former Chief Technical Officer Padmasree Warrior, who in December joined Cisco, Motorola's main rival in the cable set-top box business. Motorola also sued an ex-manager who went to work with former mobile device chief Ron Garriques at Dell.

Reuters' Motorola sues former executive over iPhone job adds only that Apple did not comment on the story.

Chicagobusiness' Motorola accuses ex-executive of giving trade secrets to Apple adds the following detail about a non-compete agreement:

By accepting those options, Mr. Fenger agreed to a non-compete clause that keeps him from working for a competitor within two years of leaving the company, Motorola said. The company also claims Mr. Fenger recruited away two former Motorola employees, something else prohibited under terms of his employment contract.

CNNMoney.com's Motorola Sues Ex-Executive; Says Disclosed Secrets To Apple notes the relationship between Apple and Motorola on developing a telephones.

Full post as published by Indiana Civil & Business Lawyer on July 23, 2008 (boomark / email).